Item 1A. Risk Factors
Item 1A. Risk Factors
Other than the risk factors below, there have been no material changes from the risk factors previously disclosed in the Company's Annual Report on form 10-K for the year ended December 31, 2021, dated April 12, 2022.
On August 10, 2022 the Business Combination Agreement was terminated, and if Crown is not able to complete another business combination by February 11, 2023, as such date may be extended pursuant to the existing governing documents, Crown would cease all operations except for the purpose of winding up and Crown would redeem Crown Class A ordinary shares and liquidate the trust account, in which case the public shareholders may only receive their pro rata share of the funds in the trust account and Crown warrants will expire worthless.
On August 10, 2022 the Business Combination Agreement was terminated and Crown may not be able to timely complete another business combination with a new target. Crown may not be able to complete another business combination, among others, due to, the relatively short period of time left until February 11, 2023, which may not be enough time to find, agree upon and approve a new business combination, the changes in the U.S. and global capital markets conditions, the rapid changes in the U.S. and global economy, including the increasing of inflation rates and interest rates, and the capital and resources Crown spent in order to pursue the Business Combination with Brivo. If Crown is not able to complete a business combination by February 11, 2023, as such date may be extended pursuant to the existing governing documents Crown will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (less taxes payable and up to $100,000 of interest income to pay dissolution expenses) divided by the number of then-outstanding public shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining Crown shareholders and the Crown Board, liquidate and dissolve, subject in each case to Crown’s obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such case, the public shareholders may only receive their pro rata share of the funds in the trust account and Crown warrants will expire worthless.
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Mutual Claims by Crown and Brivo related to the circumstances that led to the termination of the Business Combination with Brivo may develop into legal proceedings between the parties which may affect Crown’s ability to pursue or complete another business combination and may cause Crown to incur substantial costs and resources with respect to such claims or legal proceedings 8 .
On July 5, 2022 Crown issued Brivo a notice that (i) information has come to its attention which indicates that (a) Brivo has breached its obligations under Section 8.05 of the Business Combination Agreement and (b) a Key Brivo Stockholder has breached its obligations under Section 3 of the Stockholder Support Agreement and (ii) Brivo has breached its obligations under Sections 8.01(a) and 8.09(a) of the Business Combination Agreement. Crown demanded that Brivo and the Key Brivo Stockholder comply with all of their respective obligations under the Business Combination Agreement and the Stockholder Support Agreement. On July 6, Brivo responded to Crown’s notice, denied Crown’s claims and gave notice to Crown that Crown has breached its obligations under Section 8.01(a) and 8.09(a) of the Business Combination Agreement. Brivo also claimed that is has not seen any evidence that Crown is able to satisfy the conditions to closing of the Subscription Agreement with Golub and therefore the conditions to closing of the Business Combination Agreement. On July 12, 2022 Crown responded to Brivo’s letter dated July 6, 2022, denied Brivo’s claims and added that Crown has specific and credible information that Brivo and the Key Brivo Stockholder have breached the Business Combination Agreement and the Stockholder Support Agreement, respectively. Such notices were pursuant to the obligations under the Business Combination Agreement. On August 10, 2022, we received a notice of election from Brivo, notifying us that Brivo has elected to terminate the Business Combination. As a result of such election the Business Combination was immediately terminated. We believe that prior to termination Brivo breached the Business Combination Agreement, and that EMBUIA LLC, an affiliate of Dean M. Drako, the Chairman of the board of directors of Brivo, breached the Stockholder Support Agreement (as defined in the Business Combination Agreement), in each case, including breaching their respective obligations not to take certain actions in connection with a Company Acquisition Proposal (as defined in the Business Combination Agreement). We intend to vigorously pursue its remedies. These mutual claims may develop in the future into legal claims and proceedings. Such legal claims and proceeding may affect Crown’s ability to pursue or complete another business combination and could cause Crown to incur substantial costs and resources and therefore Crown may not be able to continue its operation for the full 24-month period after Crown’s Initial Public Offering or divide its limited resources to find and complete another timely business combination with a new target.
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.